House Ag Committee Approves COOL Repeal Bill

The House Agriculture Committee approved H.R. 2393, a bill to repeal Country of Origin Labeling (COOL) requirements for beef, pork and chicken. The panel amended the Agriculture Marketing Act of 1946, on a 38-6 vote. While repealing the labeling requirements on beef, pork and chicken, it leaves intact the requirements for all other covered commodities.

The bill was approved on May 20, just two days after the World Trade Organization’s (WTO) Appellate Body ruled against the United States’ COOL requirements for meat. Canada and Mexico had challenged the rule for muscle cuts of meat at the WTO, arguing that COOL has a trade-distorting impact by reducing the value and number of cattle and hogs shipped to the U.S. market.

H.R. 2393 was authored by House Ag Committee Chair K. Michael Conaway (R-Texas), and co-sponsored by 68 Democrats and Republicans. Conaway pledged to work to get the bill to the House floor as quickly as possible.

When WTO finalizes the ruling by the end of the month, Canada and Mexico can formally request permission to retaliate against the United States. Retaliation will be determined by how much the two countries can raise tariffs to address their losses under the U.S. meat labeling requirement. A panel will have 60 days to review the tariff amount, although the United States, Canada and Mexico could discuss a settlement before the 60-day clock runs out.

Without a settlement, the United States could see retaliatory tariffs by late summer or fall. Canada has already issued a preliminary retaliation list targeting a broad spectrum of commodities and manufactured products. Mexico has not yet announced a preliminary retaliation list, but has implemented retaliatory tariffs in the past, which may be indicative of future tariff actions.

“This bill is a targeted response that will remove uncertainty and restore stability for the United States by bringing us back into compliance,” Conaway said. “We must do all we can to avoid retaliation by Canada and Mexico, and this bill accomplishes that through full repeal of labeling requirements for beef, pork, and chicken.”

“With the recent decision by the WTO, we must act rapidly to avoid serious trade barriers being enacted against U.S. agricultural products,” added Rep. Jim Costa (D-Calif.), Ranking Member of the House Ag Committee’s Livestock and Foreign Agriculture Subcommittee.

“Of course no one wants to see retaliation, but it’s important to point out that there are still several steps that have to occur before that would take place,” Peterson said. “Given what we have seen in the past – it took 15 months for the Arbitration Panel to issue a ruling in the U.S.-Brazil cotton case – it’s unlikely the panel will rule on COOL retaliation within their 60 day window.”

Peterson said mandatory labeling requirements are in place in 60 other countries

“European Union labeling rules, for example, require indication of the country of birth, fattening and slaughter,” he said. “If a cow is born, raised and slaughtered in the same country, then that is the country of origin. Imported beef can be labeled as ‘non-EU’ if information is not available. For meats originating from countries where information about the animal may be unknown, the system allows for alternative claims of origin.

“There are obviously distinctions between the EU requirement and what we’ve tried to do, but I think it’s worth looking at to see if we can find a workable North American solution,” Peterson concluded.